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throughput accounting

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › throughput accounting

  • This topic has 1 reply, 2 voices, and was last updated 8 years ago by John Moffat.
Viewing 2 posts - 1 through 2 (of 2 total)
  • Author
    Posts
  • July 21, 2017 at 11:18 am #397917
    adarsh1997
    Participant
    • Topics: 646
    • Replies: 282
    • ☆☆☆☆

    Hi John!

    I am having some issue for a question in the BPP kit.

    Corrie produces three products, X, Y and Z. The capacity of Corrie’s plant is restricted by process alpha. Process alpha is expected to be operational for eight hours per day and can produce 1,200 units of X per hour, 1,500 units of Y per hour, and 600 units of Z per hour.

    Throughput/unit for product:
    x =80
    y=80
    z=200

    Determine the efficiency of the bottleneck process given the output achieved is 6,000 units of X, 4,500 units of Y and 1,200 units of Z.

    -The answer is 125% and the workings done is a bit complicated to understand.
    -Could you please help to obtain the answer?

    Thanks.

    Than

    July 21, 2017 at 3:40 pm #397960
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54835
    • ☆☆☆☆☆

    Since the machine can produce 1,200 units of X in one hour, then for the actual production of 6,000 units you would expect it to take 6,000/1,200 = 5 hours.
    Similarly you would expect it to take 3 hours to produce 4,500 units of Y, and 2 hours to produce 1,200 units of X.
    So in total it should have taken 5 + 3 + 2 = 10 hours.

    In fact, it only worked 8 hours a day, and so it was producing more than expected and was more efficient. 10 hours worth of work in only 8 hours means the efficiency is 10/8 = 125%

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